Another interesting and confusing tidbit I just discovered is this. I managed to update my dash to a version that allows me to switch the dashboard between 480i and 480p by pressing the triggers and thumbsticks. When in 480i the tv shows it as a 16:9 signal. When I switch to 480p the picture gets noticably darker and blurrier and it shows it as a 4:3 signal. I'm really starting to get confused, and I'm slightly worried that it's a problem with my tv as opposed to my xbox. A broken xbox I can deal with, a broken tv on the other hand would be very bad.
Ok, this problem is becoming larger and larger by the second. Out of curiousity I checked the difference between 480i and 480p in a game, namely Halo 2. Just from looking at the main menu alone I can tell that 480i looks much brighter and clearer than 480p. Now i know this isn't right at all. There's not a whole lot else I can do right now other than have a friend bring his xbox over sometime and see if it is like that with his as well. I just pray it ends up being a problem with my box and not my tv.